Uttar Pradesh, India (PressExposure) August 31, 2009 -- India's leading private sector lender, ICICI Bank in its bid to survive longer in the wake of cut-throat competition has slashed down the rates of their home loan products. The move made effective from August 20, will take the interest rates on home loan of up to Rs. 20 lakhs, to 8.75 percent. On the other hand, loans availed for the amount between Rs. 20-50 lakh will now carry an interest rate of 9.25 percent. Loans for the amount exceeding Rs. 50 lakhs will be available to prospective borrowers for 9.75 percent.
The home loan rate trimming has come in the picture after country's largest lender, State Bank of India introduced a competitive package early this month. The move has brought about a transition in its financing scheme as now loan products for the first year will be available for 8 percent while for the next two years, the rate would be somewhere between 8-9 percent, subjected to the size of loan availed and terms & condition of the scheme.
Not only SBI, only two weeks back, HDFC also retooled its interest rates which saw the slash down of 50 basis points resulting in a loan of Rs. 30-50 lakhs being made available for 9 percent. That is not all, LIC Housing Finance also effected a slash down of 50 basis points, taking 9.25 percent interest rate on Rs. 30-75 lakh loan to 8.75 percent.
Incidentally, despite the ICICI Bank has observed some high losses in its unsecured loans portfolio, it is willing to continue with its growth of mortgage program and auto loan portfolios. Interestingly, ICICI Bank outstanding housing loan portfolio stands at staggering Rs. 53, 472 crores (as per the figures on June 30, 2009).